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Tenants lured with big bucks to sub-let properties on Airbnb

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By Jimmy Thomson   

The prospect of six-figure earnings is being used to lure rent-investors into sub-letting multiple residential properties through holiday letting websites like Airbnb – without owning any of the homes or even, possibly, the knowledge of the property owners.

“How we make a six-figure income on Airbnb using other people’s properties… and how you can too!” announces a website featuring Nicole and Aaron Byerlee, the property power couple behind BnBProfessional, just one of several companies spruiking rent and sub-let seminars.

Online videos show pumped-up participants giving rock-star receptions to the rent and sub-let promoters.

The potential profits are very real. Research into Airbnb’s online listings has uncovered several “hosts” each with hundreds of properties under their management, with even greater numbers listed on as many as 50 niche websites.

Meanwhile, individual tenants are sub-letting their rented flats without their landlords’ knowledge, to cash in on major sporting and cultural events.

The Byerlees, who claim profits of more than $300,000 a year across their portfolio, advise hosts to get the property owners’ permission. But critics say there is little chance that the landlords would know if they didn’t.

The Byerlees, who are doing nothing illegal, didn’t respond to AFR’s efforts to contact them.

The NSW government is currently considering an “industry-led” register of holiday lets, and many see this as the best way to curb the commercial conversion of residential lets as short term rentals.

“Without a reliable, independent registry, there is no way property investors can be sure their homes aren’t being used for holiday lets,’ said Jane Hearn, Deputy Chair of the Owners Corporation Network, the peak group for apartment owners in NSW.

Approved or not, holiday lets are big business. Bnbguard, an agency that helps strata schemes target unapproved holiday lets, has identified 110 operators in NSW who each have more than 30 properties listed on Airbnb. One host alone has listed 420 properties online.

“A proposed register will flush out a lot of people who have sub-let apartments and houses without the owners’ permission, or who are operating in defiance of their strata scheme’s by-laws,’ said BnbGuard founder Reuben Schwarz.

Holiday let seminars have also set alarm bells ringing at the Tenants Union. “This is the kind of behaviour that we are very concerned about,” says Leo Patterson Ross, NSW Advocacy and Research Officer.

“One of the seminars (not BnbProfessionals) was promoting the idea that you could get around the proposed 180-day limit on holiday lets in NSW by switching platforms.”

The NSW legislation, which is awaiting the formulation of the register and code of conduct, will includes a 180 night limit for whole-home rentals (when the host is not present), for greater Sydney and rural councils, such as around Byron Bay, that choose to implement it.

There is no restriction on the number of nights allowed for whole home lets in any other Australian state.

This week a parliamentary report issued in WA recommended introducing a register of short-term rentals, new fire safety measures and the ability for strata schemes to pass by-laws to allow or restrict holiday rentals, among other measures.

Meanwhile, ordinary tenants aren’t blameless when it comes to holiday lets. The AFR knows of individual renters “couch surfing” with friends when paying guests sign up, with the property owner having no idea that the flat had been listed online.

Meanwhile, Airbnb has made clear its objections to the holiday let register proposed for NSW.

“There is a genuine risk of compulsory registration being complex, costly and time-consuming which will make it harder than it needs to be for people to share their space or home,’ public affairs manager Julian Crowley said recently.

Its largest rival, Stayz, disagrees.

“When implemented correctly in other parts of the world, the registration of holiday rentals has proven to be a low-cost and effective way of informing the development of sensible rules for our growing sector,” Stayz Corporate Affairs Director, Eacham Curry said.

This report first appeared in the Australian Financial Review.

 

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